Ready-made portfolios designed and managed for you

An investor looking to build a well-diversified portfolio would typically be faced with these dilemmas: how do I choose investments that will meet my objectives when there are so many funds and asset classes to choose from, or how should I adapt my portfolio whenever there are fluctuations in market conditions or when a fund manager changes?

A major advantage of multi-manager funds is that such difficult investment decisions are left in the hands of the expert fund managers who would analyse thousands of funds and blend them in a way that would result in the greatest potential to generate higher returns at a reduced risk.

The multi-manager team would typically keep a close watch on the market for you and fine-tune the portfolios continuously, making changes whenever they feel they are necessary.

Choosing investments for your portfolio is more challenging than ever before, and although restricting your choice might seem an obvious solution, this involves a risk: research shows that only a minority of fund managers can produce consistent returns in different types of market conditions.

For instance, out of 48 funds that were among the top 25 per cent in the European equity sector from 1995 to 2000, only 15 were able to maintain their top ranking position over the following five years. In fact, 13 of them sank into the bottom 25 per cent!

Due to these challenges, some people may opt not to invest at all, while others might opt for an index-tracker fund, which tend not to offer the growth or income potential that actively managed funds do.

Fidelity's MultiManager service builds combinations of funds to achieve a variety of investment goals. It identifies the most attractive funds and brings them together to meet the varied needs of its investors. This means that you no longer have to keep an eye on the market, as Fidelity's analysts constantly monitor it and change the blend of funds in your portfolio whenever they believe that better opportunities are emerging.

The benefits

Diversification: Your money would be spread across several different investment companies, so you can take advantage of a variety of investment styles and processes.

Access: Not only do multi- managers have the research capabilities to analyse thousands of funds, but they may be able to invest in institutional and closed-end funds, or funds managed by smaller, less recognised boutique fund houses.

Simplicity: A single investment decision gives you a ready-made portfolio of funds with ongoing management and monitoring.

Performance: It could help you to achieve higher, more consistent and risk-adjusted returns by identifying the most effective blend of funds from across the market.

The portfolios

Fidelity offers a spectrum of 12 portfolios, which are divided into five distinct 'families' and which can be sub-divided into either core or specialist portfolios.

Core portfolios can be used as the 'cornerstone' of an investment strategy. This category includes a global high income portfolio, aiming to offer a steady income, which can be reinvested for long-term growth. It also includes two multi-asset portfolios that aim to generate long-term growth through diversified combinations of different types of investments (i.e. shares, bonds, property, commodities and cash).

Specialist portfolios are designed to complement your core investments. They offer the potential for strong returns, with a controlled level of risk, by focusing on emerging markets, a specialist industry sector or a geographical region.

Unique investment approach

Fidelity's experience in managing multi-manager portfolios has shown that it is not always the top-performing funds that work together best. It may be far more important to identify a variety of minimally correlated funds (i.e. funds that follow a variety of investment strategies) which will behave differently in varying market conditions.

By blending these different funds into a single portfolio, the combined performance would be more balanced, and, over the years should deliver more periods of positive returns.

Fidelity's advantage is its key corporate strengths: its experience, performance focus, commitment to research and global resources.

Fidelity International has been managing multi-fund portfolios for almost 20 years; 75 per cent of Fidelity's multi-fund portfolios have been among the top 25 per cent in their sectors over ten years (Source: Standard & Poors, and Fidelity, May 1).

Fidelity is committed to carrying out intensive research into every investment that it makes. The team has access to Fidelity's vast resources in markets across the world and it shares research and investment ideas with analysts working in different geographical regions and disciplines.

Fidelity International Limited (FIL) and its subsidiary companies serve the major markets of the world by providing investment products and services to individuals and institutional investors outside the US. The FIL organisation manages a total of £143 billion of assets (source: Fidelity International, as at March 30).

In Malta, Fidelity MultiManager SICAV is exclusively represented by Growth Investments Limited - a wholly-owned subsidiary of Middle Sea Valletta Life Assurance Company Limited. Growth Investments markets collective investment funds in the local market provides back-office services to its parent company in connection with linked long-term contracts of insurance, and acts as a financial intermediary for securities listed on the Malta Stock Exchange.